News & Commentary

CenterPoint Properties likes to provide visitors a bird's-eye view of the $1 billion industrial park it developed that houses a Burlington Northern Santa Fe Railway rail-to-truck transfer facility and half a dozen warehouses. Some 3,800 jobs were created. The view from Elwood Village Hall is quite different. Village President Bill Offerman feels CenterPoint reneged on pledges to build a hotel and restaurants and create upward of 12,000 jobs. The project didn't generate any taxes while it was under construction. So when the developer asked for about $88 million in reimbursements, the village issued TIF notes, basically IOU vouchers, to CenterPoint. The notes paid interest of 10 percent compounded twice a year for 20 years. "Ten percent is really high no matter what we are talking about," said Brian Battle, director of trading at Chicago-based Performance Trust Capital Partners, an investment adviser. Battle said 10 percent was about double the rate of debt issued by some of the highest-rated states like Texas or Virginia.

U.S. central bankers are meeting in Jackson Hole this week to discuss monetary policy, leaving investors "tapping their feet" as they await the Fed's decision, said Brian Battle, director at Performance Trust Capital Advisors. For now, all investors can do is wait for minutes from the Federal Open Market Committee's July meeting to be released. "It's all on hold now, and we're in a low-volume environment because it's the end of the summer," Battle said. "We're pretty sure the Fed minutes are going to be a nonevent, but you're never sure until it's released." Battle said there are "nascent" indications that the economy is slightly improving, and data released Tuesday seemed to confirm that.

Allegiance Bancshares executives long saw Independence Bank as a potential acquisition target, but what finally prompted the two Houston lenders to pair up? "The Independent IPO really brought a lot of focus in that size range, and the sales pitch is that you could be a part of the next Texas bank to go public," says Daniel Bass, a managing director of Performance Trust Capital Partners, one of the advisors to the $220 million-asset Independence Bank. "It really ignited the banks like Allegiance to try and get to $1.5 billion in assets," a rule of thumb for banks that want to get the market's attention.

Allegiance Bancshares Inc. has agreed to acquire the $220 million-asset Independence Bank, executives told the Houston Business Journal on Monday...the deal gives Allegiance a larger asset base from which to launch another major franchise in the city, said Dan Bass, Houston managing director for Performance Capital Trust Partners LLC. “I think they’re going to be a major player in Houston on a long-term basis,” Bass said. “Once you get to $1 billion (in assets), you’re on the radar screen for people trying to get into Houston. Not that they’d sell, … but the bigger you are, then the more you can spread out the cost and drive the efficiency ratio down.”

BAfter weaker-than-expected job growth in July announced this morning, the stock market is taking a breather and is trading slightly lower in early trading after hitting record highs Thursday. Brian Battle, director at Performance Trust Capital Partners in Chicago, says the weak jobs number "in no way threaten the Feds description of a weak economy." As a result, Battle's take is that Fed tapering is "further off."

In Illinois, the unemployment rate is 9.2 percent, while nationally the rate stands at 7.4 percent. Why is it so much higher here? Illinois has the second-highest state unemployment rate in the country. Only Nevada's 9.6 rate is higher. Illinois is a state with too many people looking for work and not enough businesses and public agencies with available jobs. Brian Battle is one of the bosses at Performance Trust, a bond trading company in Chicago. He says fewer businesses are coming or growing to Illinois in fear of rising taxes and gridlocked politics.

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